Draw a graph to show the market effects of the minimum price

Assignment Help Econometrics
Reference no: EM131130258

Excess Supply from a Minimum Milk Price. In the equilibrium in the powdered milk market, the quantity is 100 million units and the price is $9.00 per unit. The price elasticity of demand is 0.80 and the price elasticity of supply is 2.50. Suppose the government imposes a minimum price of $9.90.

a. Draw a graph to show the market effects of the minimum price.

b. At the minimum price, the quantity of powdered milk supplied is____ million units, the quantity demanded is_________ million units, and the excess supply is _______million units.

Reference no: EM131130258

Questions Cloud

What is the whole exome sequencing : What is the Whole Exome Sequencing (WES)? What is the goal of it? Applications of exome sequencing. What is comprised? Motivation and comparison to other approaches.
Cost of common equity-equity comes from retained earnings : Cost of Equity with and without Flotation Javits & Sons' common stock currently trades at $28.00 a share. It is expected to pay an annual dividend of $1.00 a share at the end of the year (D1 = $1.00), and the constant growth rate is 3% a year. What i..
Draw two sets of supply-demand curves : In the case of more elastic supply, is the deadweight loss larger or smaller?
Chain of command and the method of public health response : Describe the chain of command and the method of public health response that was conducted in Severe Acute Respiratory Syndrome (SARS) public health emergencies situation.
Draw a graph to show the market effects of the minimum price : At the minimum price, the quantity of powdered milk supplied is____ million units, the quantity demanded is_________ million units, and the excess supply is _______million units.
Project has a required payback period of three years : A project has a required payback period of three years. Which one of the following statements is correct concerning the payback analysis of this project?
Research three different dance organizations : Research three different dance organizations located in the state of Texas.- they are for profit or not for profit, their mission statement and focus.
What is the net amount of funds from each loan : Your firm is considering two one-year loan options for a $478,000 loan. The first carries fees of 2.5% of the loan amount and charges interest of 3.9% of the loan amount. The other carries fees of 1.7% of the loan amount and charges interest of 4.4% ..
Identified the investments as looking promising : A company has identified the following investments as looking promising. Each requires an initial investment of $1.2 million. Which is the best investment?

Reviews

Write a Review

Econometrics Questions & Answers

  What is the short-run average cost

A firm is a perfectly competitive industry with atotal revenue of Php 2 million a year when producing 200,000 unitsof output per year; a) Find the firm's average revenue (AR); b) Find the firm's marginal revenue (MR);

  What is the least squares estimate of ß1

Consider the simple linear regression model without an intercept, y = ß1x + u, with the assumption E(u|x)=0. Also assume that E(x)=0 Show that E(y)=0 and using this as well as E(x)=0 show that the covariance between x and y is given by E(xy) and that..

  What is the meaning of the term 1-l and the optimum level

U(C,1-L)=4C2/3(1-L)1/3, where C is the amount of consumption and L is the number of hours worked. If the price for consumption is $9, the wage rate per hour is $6, initially the consumer had $162 and 24 hours as time endowment

  Find optimal number of shirts produced to minimize cost

The cost function per t-shirt is identified to be the following: y=ln(X+1). Fixed costs associated are a step function based on area needed. For each 1000 shirts, the cost associated with storage space is $1000 .

  Find an ad-valorem tax that would generate revenues

In a competitive market, the industry demand and supply curves are P=200-0.2×Qd and P=100+0.3×Qs, respectively. Can you find an ad-valorem tax that would generate $3200 of revenues for the government

  Establish a similar equivalence for a classification network

Establish a similar equivalence for a classification network.

  What is probability that the survey will provide a sample

People end up tossing 12% of what they buy at the grocery store (Reader's Digest, March, 2009). Assume this is the true population proportion and that you plan to take a sample survey of 540 grocery shoppers to further investigate their behavior.

  Find the optimal amount of investment when t is given

Suppose a consumer has wealth w and is considering investing some amount,x,in risky asset.This asset can earn a return of Rg(which is positive return and therefore a good outcome or Rb

  Determine how often does tracy go to the atm

Solve Tracy's problem of how often to go to the ATM when nominal interest rate on her bank account is 10%, she spends $30 each day, it cost her $0.50 each time she uses the atm, and she thinks that there is a 15% chance.

  Find a cost and revenue structure for designing

You are planning to build a new home with approximately 2,000 -2,500 gross square feet of living space on one floor. In addition you are planning an attached two car garage (with storage space ) of approximately 450 gross square feet.

  How retailers pricing decision imposes an externality

Suppose we have a wholesaler firm that charges a retailer r for the retailer's only input. The marginal cost of the wholesaler is $2. It takes one unit of the input to produce one unit of the retailer's output and in addition to the price of the i..

  Determine what level of q maximizes net benefits

Suppose that the total benefit and total cost from an activity are, respectively, given by the following equations: B(Q)=150+28Q-5Q(squared) and C(Q)=100+8Q. (Note:MB(Q)=28-10Q and MC(Q)=8.) a. write out the equation for net benefits.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd